Economists have downgraded their forecasts for the Australian dollar on the expectation that the US Federal Reserve is getting further in front of the Reserve Bank’s timeline for monetary tightening, despite the currency already trading below fair value on account of the bear market in iron ore.

The median forecast from The Australian Financial Review’s quarterly survey of 26 economists predicts the Australian dollar will appreciate to US74¢ by December 2021, and remain stable for the next 12 months out to December 2022. The December 2021 projection is down from a US78¢ forecast in the June quarter survey.

Amid question marks over the future of stricken Chinese property developer Evergrande, and an energy crisis putting China’s growth rate at risk, the currency was fetching US72.96¢ on Monday.

“The Australian dollar is easily the weakest G10 currency over the past three months,” says Sean Callow, senior currency strategist at Westpac.